Goldman Sachs posted third-quarter results on Tuesday,
reporting a 40 percent decline in profits. From June to
September the investment bank earned $1.9 billion, or $2.98 per
share. Revenues fell 28 percent from 2009's third quarter
to $8.9 billion.

Analysts responding to a recent Thomson Financial survey had
projected earnings of $2.28 per share for the firm, which had
reported earnings of $5.25 per share for the same period a year
ago. As recently as July, analysts were estimating the
banks' third quarter earnings to come in at around $4.00 per
share, but trading volume on US stock exchanges tumbled during
the quarter, dropping 26 percent, which deprived the nation's
big banks of a significant amount of commission revenue.

As a result of the dropoff in trading volume, revenue for
Goldman Sachs' trading and principal investment division fell
36 percent from last year's $8.8 billion in the third quarter
to $6.4 billion.
The numbers mean lower pay for the bank's well paid employees,
as the firm set aside $3.8 billion for compensation and
benefits in the latest quarter. This brings their
per-employee payout so far this year to about $370,000, down 30
percent from the same figure in 2009.

Tuesday's report comes when investors are becoming wary of the
nation's big banks in light of impending financial reform
legislation, higher capital rules, and legal concerns faced by
large lenders. Bank of America on Tuesday issued a
statement declaring that reforms in financing legislation would
cost the firm an estimated $10 billion.